O'Melveny Insights 2023

12 Clean Energy’s Bright Future The IRA’s structure also means it should continue to incentivize renewable energy investment even if the US economy slides into a recession. Traditionally, helping the environment is given low priority during challenging economic periods. But the IRA’s incentives will continue regardless of any downturn. For instance, by allowing developers and owners to transfer tax credits and claim certain refundable credits, the IRA expands the scope of taxpayers that can take advantage of those credits beyond companies with sufficient tax capacity to benefit from tax credits. We stand at an inflection point in the global energy market: a confluence of proven green technologies, technological breakthroughs in the design and manufacturer of large storage battery systems, and the growing adoption of hydrogen. All this spells transformative change—change that we are already seeing with our clients on the ground. This transition, like any other, will have ups and downs, but there are tremendous opportunities for entities that are able to take advantage of the public and private incentives that have been created in this space. There are tremendous opportunities for entities able to take advantage of the public and private incentives created in the energy space. The Inflation Reduction Act amounts to one of the most consequential clean-energy bills in recent memory.